FRANKFURT/LOS ANGELES, Feb 18 (Reuters) – German solar
energy pioneer Frank Asbeck is betting that the United States
can rehabilitate him and his company SolarWorld,
which he rescued from the jaws of insolvency two years ago,
making himself an industry outcast in the process.

Asbeck, 55, pursued measures both imaginative and ruthless
to ensure that his solar panel company did not fall victim to a
crisis that claimed many of its German peers.

For years, demand for solar panels and cells thrived in
Germany thanks to lavish incentives, until sharp cuts in
subsidies and fierce Asian competition put an end to that.

Now, having single-handedly unleashed a trade war, Asbeck is
looking across the Atlantic to rebuild a company whose market
value peaked at 5.2 billion euros ($5.9 billion) in 2007, and
now stands at 169 million.

“This year, we plan to sell more than 60 percent of our
panels in the United States,” Asbeck told Reuters, compared with
41 percent in 2014.

He said SolarWorld commanded a 10 percent share in what is
now the world’s third-biggest solar market after China and
Japan, a fact that could help it this year to post its first
operating profit since 2011.

SURVIVOR

“This is a company with a great brand and a reputation for
quality and is a survivor,” said Shawn Kravetz, president of
Boston-based investment management firm Esplanade Capital, which
has started to buy shares in SolarWorld over the past year.

Even reluctant admirers say only the larger-than-life Asbeck
- who is known as the “Sun King” in Germany, and once made a bid
for General Motors’ struggling European unit Opel – could pull
off such a comeback.

A castle owner and passionate boar hunter, Asbeck convinced
the state of Qatar in 2013 to take a stake in SolarWorld when it
was on the brink of insolvency, while keeping him as CEO.

“You have to admit that Mr Asbeck is one of the most
impressive entrepreneurs in Germany,” said an executive at a
major rival, who declined to be named. “The way he saved the
company is unique in German corporate history.”

Part of Asbeck’s plan was to orchestrate a trade war that
not only pitted SolarWorld against rivals in China but also
alienated many Western players.

“The Chinese came in and ate their lunch,” said Ash Sharma,
senior director at research firm IHS. “I think he’s trying to do
both: save the industry as well as his own company.”

By arguing that Chinese panel makers received unfair
subsidies, Asbeck succeeded in getting stiff duties imposed on
Chinese panel imports in the United States as well as minimum
panel prices in Europe.

DOWNWARD SPIRAL

But many in the industry argue that, by pushing up prices,
anti-dumping duties trigger tit-for-tat responses that
ultimately endanger jobs all along the value chain.

China has already retaliated by slapping duties on imports
of U.S. polysilicon, used in solar cells, causing Hemlock
Semiconductor, a joint venture of Dow Corning and
Shin-Etsu Handotai, to announce in December that it
was shutting a production plant in Tennessee.

“The worst part of this is one German person could
manipulate the entire trade apparatus of the United States for
his own personal gain,” said Jigar Shah, chairman of the
Coalition for Affordable Solar Energy, a group of companies
opposed to the trade case.

Asbeck still thinks the U.S. market is profitable, however,
saying his brand justifies a 10 percent price premium there.

The U.S. could install up to 20 gigawatts (GW) of solar
capacity over the next two years, about a fifth of the total
global market, according to estimates from industry association
SEIA and GTM Research, compared with about 7 GW in 2014.

Germany, meanwhile, installed less than 2 GW in 2014,
compared to a peak of 7.6 GW in 2012.

“If other countries dump products via state support,” Asbeck
said, “you have to return to the rules of the game”.

FRANKFURT/DUESSELDORF, Jan 30 (Reuters) – SMA Solar
, Germany’s largest solar company, expects to make a
loss for the third year in a row in 2015, with no let up in
falling demand in Europe and fierce competition from Asia.

However, the company said on Friday it aimed to return to a
profit in 2016, helped by more than 160 million euros ($181
million) of cost cuts.

Shares in SMA Solar, down more than 27 percent year-to-date,
were 6.9 percent higher at 11.179 euros by 1015 GMT, bouncing
back from a record low of 10.275 euros hit on Thursday.

“Cost cuts are certainly a good thing. But the question
remains whether it’ll be enough to fend off competition from
Asia,” said one Frankfurt-based trader.

Western solar companies have been hammered by falling demand
for solar panels in Europe, where governments have pared back
incentives, and overcapacity due to cheap competition from Asia.

SMA Solar, once considered immune to the crisis due to its
technological advantage over Asian peers, is in the midst of a
major overhaul and this week said it would cut 1,600 jobs, or
about a third of its workforce.

The firm, part of the Dutch TenneT group, applied to
regulators in December to build the SuedLink line.

It is one of three new links to supply the industrial south
with wind power generated in the north by 2022, when its nuclear
power plants shut down for good and as Germany also moves away
from thermal energy.

But in the run-up to regional elections in March,
politicians in Bavaria are bickering over whether the
southeastern state even wants SuedLink, which the federal
government in Berlin signed off for.

“We need decisions over the next two months,” TenneT board
member Lex Hartman told Reuters in an interview.

“We haven’t got time to continue discussions for another six
months, otherwise the grids won’t be ready until 2022.”

Some Bavarian politicians say they are concerned the new
power lines might also transport coal-fired power into the
traditionally conservative state, a where many citizens combine
environmentalism with strong opposition to new infrastructure on
their doorstep.

Hartman said inaction also risked the failure of other
German programmes to modernise a grid that was ill-equipped to
deal with the increasingly frequent power fluctuations that the
new energy mix was causing.

“Germany has taken decisions, but they are not being turned
into action. We might start missing the Energiewende (energy
transition) goals much more frequently,” he said.

“This stresses the equipment and costs a lot of money.”

He said he expected TenneT’s costs linked to managing
volatile wind and solar power volumes in its grid zone, running
from the North Sea to Bavaria, to rise to 250 million euros
($289 million) this year from 150 million in 2014.

Since 2011, TenneT’s figures show the firm’s engineers had
to cope with 1,000 ‘special incidents’ on more than 300 days per
year to adjust load flows to stabilise the physicality of the
line – costs borne by the consumer.

In 2003, there were just two such incidents.

Winter storms earlier this month led to wind power peaks of
over 30 gigawatts (GW), equivalent to the output of 20 nuclear
power stations, TenneT has said.

BERLIN (Reuters) – RWE is exploring the sale of power plants, its chief operating officer told Reuters on Tuesday, frustrated with profit erosion and lack of political support for its struggling generation units.

Europe’s power sector has been hit by a sluggish economy, low wholesale prices and a surge in demand for cleaner renewable energy which is replacing gas and coal-fired power plants.

German utilities’ business models have also been disrupted by domestic reforms that have incentivized the move toward cleaner energy and away from fossil and nuclear power.

In one of the most drastic responses to the sector’s ongoing crisis, RWE, Germany’s biggest power producer, is now mulling going as far as pulling down and shipping abroad fully functional gas-to-power plants.

“We examine, among other options, the sale of power plants into foreign countries,” Rolf Martin Schmitz told Reuters in an interview. “But the market is very difficult.”

RWE said last year that 20-30 percent of its power stations could not cover their operating costs, after posting its first annual net loss in more than six decades.

It is now considering selling a complete Dutch gas-fired power plant that has only been in operation for a few months, Schmitz said.

“It just doesn’t make sense to have a modern, operational unit without anyone paying for it, for example through reserve payments,” Schmitz said.

His comments come two months after RWE’s top rival E.ON, whose stock market value has plunged by about three quarters since 2008, shell-shocked the industry by announcing it would split its business in two to focus on renewable energy.

Earlier this month, E.ON also struck an agreement to sell all its Italian coal- and gas-fired plants to Czech energy firm EPH for an undisclosed sum.

Since the start of 2013, RWE has closed 12,600 MW of capacity, nearly a quarter of its European portfolio, and Schmitz said the company was examining whether or not to mothball further plants.

FRANKFURT, Jan 19 (Reuters) – Germany’s biggest utilities
have set aside tens of billions of euros to fund the country’s
exit from nuclear power from 2022, when the last reactor leaves
the grid and the clear-up begins.

But as an energy crisis puts the value of the assets
underpinning those provisions at risk, concerns are growing that
taxpayers may end up footing part of the bill, undermining an
ambitious shift to renewable power on which Chancellor Angela
Merkel has staked a hefty chunk of political capital.

The broad expansion of solar and wind energy has already hit
private citizens’ pockets, as well as forcing the utilities to
adopt riskier business models that, analysts say, could put some
of them out of business.

“There are worries that the traditional utility business
will no longer deliver enough profits to fund the provisions,”
said a senior accounting source. “That concern is valid.”

Germany’s “big four” – E.ON, RWE, EnBW
and Vattenfall – have piled up 36 billion
euros ($42 billion) to switch off their nuclear plants by a 2022
deadline, set following the Fukushima disaster in Japan in 2011,
and to pay for waste storage.

Those are the highest nuclear provisions in the world,
reflecting Germany’s determination to establish a template for
other nuclear nations on coping with the afterlife of reactors
over several decades.

But the firms are under pressure from low wholesale power
prices, weak demand in the euro zone and soaring supplies of
subsidised renewable energy, which is gradually pushing gas- and
coal-fired power stations out of the market.

Analysts therefore see little upside for Germany’s biggest
utility stocks, which have lost 125 billion euros in market
value over seven years.

That adds to impressions that the industry faces an
uncertain future and, in the most drastic response to the crisis
so far, top player E.ON span off part of its business late last
year

The firms offer regular assurances that they can meet their
nuclear responsibilities – “our provisions are checked annually
in great detail by independent outside evaluators,” E.ON’s
finance chief said in November – but that does not necessarily
mean the cash will keep flowing through the coming decades.

WELL-KEPT SECRET

At 14.6 billion euros, E.ON holds the most of the industry’s
nuclear provisions, with RWE and EnBW and Vattenfall holding
progressively smaller shares.

There is little concern about the overall 36 billion euro
figure, but whether the assets standing behind the provisions
can be turned into money is far less clear.

Utilities have not spelled out how the provisions are backed
up, saying only that some are held in cash and the rest in
undisclosed assets and instruments.

Sector analysts reckon that while part is invested in asset
classes such as equity or pension funds, much is backed by power
networks and plants whose value has plummeted.

Over the past year, E.ON, RWE, EnBW and Vattenfall have
announced nearly 12 billion euros of writedowns and impairment
charges, mostly due to tumbling power prices.

“It is becoming clear that the investments in power plants
… can’t simply be converted into cash,” said Felix Matthes of
green think tank Oeko-Institut, which regularly advises the
government.

He said E.ON and EnBW held most of their provisions in safer
investments, but Vattenfall and RWE were more exposed, pointing
to lignite assets that were declining in value.

Some politicians fear the utilities may eventually leave the
state to shoulder the problem, and that the largest – like the
banks judged “too big to fail” – could have to be nationalised.

E.ON’s split carried the risk “that the financial burden of
unwinding the nuclear plants will fall to the state,” the
environment minister of Lower Saxony state said last month.

Oliver Krischer, parliamentary energy spokesman for the
Green Party, noted that Germany’s nuclear history was “full of
examples of profits being privatised and costs rolled over to
the public.”

The federal Economy Ministry has commissioned a study on how
to safeguard the decommissioning funds, and results are expected
this month.

“It is the job of the government to prevent this (erosion of
asset value) from happening,” Krischer told Reuters.

FRANKFURT, Jan 16 (Reuters) – German utility RWE
will complete the sale of oil and gas unit DEA to
Russian tycoon Mikhail Fridman by early March, it said on
Friday, easing fears of a potential collapse.

RWE, whose shares were up 6.1 percent at 1300 GMT on the
news, had originally planned to close the transaction by the end
of 2014 but in November warned it could take longer.

The deal, first announced in March last year, coincided with
sanctions being imposed on Russia for its actions in Ukraine,
raising questions in some EU countries about whether a European
oil and gas business should fall into Russian hands.

A string of German-Russian transactions have fallen apart
amid growing tensions between Moscow and the West over Ukraine,
including a major gas asset swap deal between German chemicals
group BASF and Russia’s Gazprom.

The fallout from the crisis also saw German healthcare group
Fresenius SE terminate a generic-drugs joint venture
agreement with its Russian partners while retailer Metro
delayed the stock market listing of a stake in its
Russian cash-and-carry operation.

“We are pleased to have reached a final agreement with RWE.
DEA is a strategic transaction for LetterOne and will serve as a
platform for further growth in the industry,” said Mikhail
Fridman who is the main owner, a founder and chairman of the
LetterOne investment vehicle.

The transaction requires approval from the 14 countries
where DEA operates, including Britain, which has been reluctant
to agree to it, concerned that DEA’s British assets could stop
producing should future sanctions against Russia hit LetterOne
or its owners.

LetterOne said it would keep DEA’s British assets separate
from the rest of the unit for a number of years, adding RWE
would be obliged to buy back those assets, worth about 1 billion
euros, during the first year following completion of the deal
should sanctions be imposed against the buyers.

In that case, RWE would sell on the assets to an independent
third party, it said.

RWE said DEA’s final enterprise value (equity plus debt) was
lowered to 5.0 billion euros, down from the 5.1 billion
announced in March last year, “to reflect developments relating
to certain exploration and production licenses”.

“There were concerns that the final price might come down
quite a bit as part of the delays,” said a Frankfurt-based
trader.

FRANKFURT, Jan 12 (Reuters) – Germany’s largest utility E.ON
AG has agreed to sell its Italian gas- and coal-fired
power plants to Czech energy company EPH, ridding itself of
ailing assets from an acquisition spree in 2007.

Privately-held EPH will take over 4,500 megawatts (MW) worth
of thermal power capacity in the deal, which is expected to
close in the second quarter of 2015.

Both parties agreed to keep the purchase price confidential.
Sources have said that E.ON’s Italian business as a whole could
fetch about 2 billion euros ($2.4 billion), with more than half
from E.ON’s local renewable energy assets.

This transaction includes E.ON’s 600 MW coal-fired plant in
Sardinia and 3,900 MW worth of gas-fired power capacity spread
over six power plants in mainland Italy and Sicily.

E.ON also owns about 1 gigawatt of renewable power capacity
in Italy and has some 860,000 power and gas clients there.

“We continue to assess a possible divestment of our other
businesses in Italy as well,” E.ON Chief Executive Johannes
Teyssen said in a statement on Monday.

Sources told Reuters last month that EPH was interested in
buying some of the Italian assets E.ON had put up for sale in an
attempt to recoup some of the 11.5 billion euros spent on assets
in southern Europe in 2007 in a bet on rising energy demand.

E.ON has since written down those southern European assets
by more than half, burdened by massive power plant overcapacity
across Europe.

EPH’s Chairman Daniel Kretinsky has previously said the
company was looking to diversify in Europe, saying its presence
in core markets was “relatively extensive”.

The company is also looking at the German lignite assets of
Swedish utility Vattenfall.

E.ON, whose stock market value has plunged by about three
quarters since 2008 on the back of a sluggish European economy
and weak power prices, is in the middle of splitting its
business in two to focus on renewable energy.

The company last month said it had sold its Spanish business
to Australian infrastructure investor Macquarie for 2.5
billion euros.

($1 = 0.8473 euros)

(Additional reporting by Michael Kahn in Prague; Editing by
Kirsti Knolle, David Holmes and David Clarke)

FRANKFURT, Jan 12 (Reuters) – The slump in oil prices to
their lowest since 2009 will bring a multibillion-euro boost to
European businesses, but the benefits are being distributed in a
patchy fashion and in some surprising places.

While the oil industry has been left licking its wounds
after Brent crude’s 50 percent plunge to about $50 a barrel
over the past six months, fund managers and analysts
have been turning their attention to the likely beneficiaries.

Big chemicals, household goods and some logistics companies
have been identified as potential winners. But in the search for
growth, investors are also on the lookout for niche players
within these sectors, including brewers, perfume producers,
lubricant makers and glue manufacturers.

“The bottom line is: the oil price crash is a stimulus
package and comes at the right time,” Volker Treier, deputy
managing director of the German Chambers of Commerce (DIHK),
told Reuters, adding that it would boost Europe’s largest
economy by at least 0.5 percent points this year.

DIHK reckons the cost savings for German industry could
amount to 20 billion euros ($23.63 billion) this year, while low
fuel prices are expected to leave more cash in consumers’
pockets for goods and services.

The potential for deflationary pressures to dissuade
consumers from spending in the expectation of lower prices
remains a caveat, though Chris Iggo, chief investment officer
for global fixed income at AXA Investment Managers, believes
lower oil prices to be “unambiguously positive” for growth.

“I disagree entirely with the notion that the decline in
oil prices is negative and adds to the deflationary outlook,” he
said.

Analysts and fund managers also see upside for the
oil-dependent adhesives business of Henkel, which
accounts for about half of the consumer goods company, as well
as fragrance and flavours maker Givaudan, the products
of which also rely on oil-based materials.

Since June, European personal and household goods stocks
and chemicals have outperformed the broader
equity market as well as the oil sector.

Frederic van Parijs, senior portfolio manager at ING
Investment Management, also pointed to gold mining groups, such
as Randgold, which require a lot of oil in their hunt
for the precious metal.

TRAVEL IMPACT

Less surprisingly, travel groups and some logistics
businesses have also come into focus.

“We see investment opportunities at transport companies …
at airlines and operators of cruise liners, where oil
consumption is a significant cost driver,” said Adrian Daniel,
fund manager at MainFirst.

Travel companies have already reported falling fuel costs,
including Carnival, the world’s largest cruise operator,
which said fuel prices fell 15.5 percent in the fourth quarter.

Shares in oil storage and transportation players, including
Belgium-based Euronav, Netherlands-based Vopak
and Oslo-listed Frontline, have also
attracted investors after a pick-up in oil futures.

For the road-haulage operators, however, the falling oil
price is a double-edged sword because they must pass on most of
the lower fuel costs to their clients as part of long-term
contracts that reflect price swings.

Furthermore, tax accounts for about two thirds of the price
of fuel in Germany, compared with about a fifth in the United
States. Average diesel prices in Germany have fallen only 7
percent since June, according to most recent figures from the
German statistics office.

“The sector does not benefit to the extent you might
expect,” said Ingo Hodea, spokesman for the German road haulers
and logistics association DSLV, the 3,000 members of which
generate annual sales of 80 billion euros.

European industrial goods and services stocks, which
include TNT Express and Deutsche Post, are
down 2 percent since early 2014, reflecting that it’s their
clients that enjoy the most benefit.

“But there is an exception for those companies that have
strong pricing power with little competition,” he added,
pointing to German lubricants business Fuchs Petrolub
as one example.

The Mannheim-based company is mainly up against unlisted
medium-sized businesses, while oil majors are not sufficiently
specialised to compete effectively with Fuchs Petrolub in the
niche lubricants market.
($1 = 0.8465 euros)

(Additional reporting by Matthias Inverardi and Tom Kaeckenhoff
in Duesseldorf, Frank Siebelt and Daniela Pegna in Frankfurt,
Anthony Deutsch in Amsterdam, Sandor Peto in Budapest and Simon
Jessop in London; Editing by Thomas Atkins and David Goodman)

FRANKFURT/DUESSELDORF, Dec 17 (Reuters) – E.ON’s
investment strategy in Russia remains unaffected by the plunge
in the rouble, the company said on Wednesday, seeking to allay
concerns over a business it plans to spin off in 2016 as part of
a major overhaul.

The weakening of the rouble in the face of Western sanctions
over the Ukraine crisis has already hit profits at the German
utility’s Russian operations, in which it has invested about 6
billion euros ($7.5 billion) since 2007.

E.ON has repeatedly sought to reassure investors, but the
rouble’s 20 percent plunge against the dollar
over the past two days triggered a massive interest rate
increase by the central bank and cranked up the presure on
companies on the ground.

“Our business in Russia has been a solid profit driver for
six years,” a spokesman for the company said in an emailed
statement on Wednesday, adding that the swings in the rouble
would not affect its long-term investment plans.

“E.ON continues to have faith in the stable investment
conditions that have been guaranteed by the Russian government
so far.”

He acknowledged, however, that E.ON continues to monitor the
Russian situation closely.

The company, shares in which were down 0.8 percent at 1403
GMT, has ties with Russia on several levels. It imports about
half of its gas from Gazprom and the country
contributes more than 7 percent of E.ON’s core profit.

E.ON owns 10.3 gigawatts of Russia’s generation capacity,
more than 4 percent of the total, and is also a partner in the
huge Yuzhno Russkoye gas field in Siberia.

Nevertheless, the company announced last month that it would
spin off its power plant business along with its Brazilian and
Russian units in a move that is widely viewed as an effort to
rid itself of problematic assets.

Profits from Russia were down by nearly a fifth in the first
nine months of the year because of the currency weakness.
($1 = 0.8032 euros)

SAO PAULO/FRANKFURT, Dec 10 (Reuters) – Eneva SA,
the Brazilian power producer controlled by Germany’s E.ON SE
and tycoon Eike Batista, filed for creditor
protection late on Tuesday after failing to refinance part of
its 2.33 billion reais ($900 million) in debt.

In a statement, Eneva said court protection from creditors
will allow the ailing power producer to preserve cash and
continue its operations. Following the decision, Eneva appointed
Alexandre Americano as chief executive officer, replacing Fabio
Bicudo, who will become chairman.

Eneva, formerly MPX Energia SA, is the fourth company
controlled by Batista’s commodities, energy and logistics
conglomerate forced to seek protection from creditors over the
past year. E.ON gained control of Eneva following the collapse
of the conglomerate, known as Grupo EBX. Batista founded MPX in
2001.

Shares of Eneva slumped 20 percent in São Paulo trading on
Wednesday, while E.ON gained 1 percent in Frankfurt. Filing for
bankruptcy protection in Brazil allows the company to suspend
debt payments to creditors and present a revamped business plan
within 60 days.

E.ON changed MPX’s name to Eneva last year and hired Bicudo
to turn around the company by cutting costs and accelerating the
completion of some projects. Under Bicudo, Eneva boosted power
production to the equivalent of 2.4 gigawatts, earning around 2
billion reais in revenue over the past 12 months.

Net income and core earnings at Dusseldorf, Germany-based
E.ON, which owns 43 percent of Eneva, would not be affected by
Eneva’s bankruptcy protection petition.

The German utility reduced the value of its stake in Eneva
by 340 million euros last year. Currently it is worth around 100
million euros, a E.ON spokesman said.

“Eneva suffers from a lack of liquidity caused by a
combination of operational issues, a stressed market environment
and high levels of debt and interest,” E.ON said in a statement
on Wednesday.

Eneva operates seven thermal electricity plants that were
not included in the petition. The request for bankruptcy
protection encompasses the holding company and its Eneva
Participações SA unit.

Some of Batista’s main companies, including oil producer OGX
Petróleo e Gás Participações SA, also sought court protection
from creditors. OGX’s creditor protection petition was the
largest ever bankruptcy plan in Latin America.